SwitchCore's Extraordinary General Meeting Authorizes New Issue and Elects New Board Member.

LUND, Sweden--(BUSINESS WIRE)--Nov. 11, 1999--

SwitchCore's extraordinary general meeting today unanimously approved the board's proposal for authorization of a new cash stock issue with preferential rights for stockholders. SwitchCore AB (publ) is an SBI-listed company. The approaching issue is in line with the company's financing plan. The added capital injection will cover the buildup of working capital, including increasing the inventory and accounts receivable, as well as boosting investments before and during the commercialization of the company's products. The capital will also enable accelerated marketing and product development. The meeting also decided to increase the number of board members from seven to eight, and elect Erik Gabrielson, an attorney, as a new board member.

The extraordinary general meeting authorized the board to make a new cash stock issue of a maximum of 1,666,667 stocks. Stockholders will have preferential rights. The issue is for a one time only - up to the time of the next AGM. The new issue will be made at a stock price that the board deems as best for enabling the company to acquire new capital. The coming issue will cover capital requirements up to 1Q01. This issue is expected to bring in approximately SEK 120-150 million.

Erik Gabrielson, an attorney and partner in the AdvokatfimanVinge firm in Malmo, Sweden was elected as a new board member. He brings important legal skills to the SwitchCore board as well as experience from board work in other listed companies. He is Chairman of Gandalf AB (publ), Exray Intercom AB, and Ferryl AB, and a board member for Fyrtech Microelectronics AB. Since SwitchCore was founded, Gabrielson has been the company's attorney and through this position, has extensive knowledge of the company's operations and future development goals.

The extraordinary general meeting, according to the board's proposal, decided:

--To implement changes in the corporate bylaws according to the following: paragraph 6: The board shall consist of at least three (3) members and at the most eight (8) members and at the most eight (8) deputies. Board members and deputies are elected annually at the AGM for the period up to the next AGM.

--SwitchCore's consistently positive stock performance history increases the subscription rate from SEK 30 per stock to SEK 100 per stock for the detachable subscription options in the new issue of a promissory note with 550,000 detachable subscription options for employees of SwitchCore AB and its subsidiaries, which was decided at the 1999 AGM. To retain the positive effects that have been the objective with the launch of the options program, the meeting further proposed to authorize SwitchCore Options AB to retain the opportunity to sell these options to employees at a price below the price established in the Black & Scholes valuation. Each option gives the employee the right (to acquire warrants) to purchase stock in SwitchCore AB. Personnel in Sweden can currently convert their options during the period July 31 through October 31, 2001, at a redemption price (strike price) of SEK 235 per stock. Personnel in the US will be able to convert their options successively up to and including August 31, 2009 at a strike price corresponding to the average rate in force at the time of converting their options.

SwitchCore AB (publ) was founded in 1997, the result of a three-year research project at the Universities of Lund and Linkoping in Sweden. SwitchCore's CXE technology considerably increases the capacity in data and Internet switches. SwitchCore's first commercial switching device is expected to be the world's fastest, with a capacity of up to 16 Gbits, in a single chip, which is significantly quicker than existing technology today. The company currently employs over 60 people with offices in Lund, Stockholm, and San Jose, California. SwitchCore's stock is quoted on the SBI list under the SCOR symbol. Nordiska Fondkommission is the market maker and sets the SBI price, which is connected to the SIX and Reuters systems. The company intends to apply for a listing on the Stockholm Stock Exchange's O-list before the end of the year and, within 18 months of the stock being quoted on the O-list, apply for a NASDAQ listing in the US.